Jason Little, Lead of The Cannabis Practice Team at Farrell Fritz, returns to discuss the recent federal appeals court ruling that New York State's cannabis licensing criteria, which excluded individuals with federal or out-of-state cannabis convictions from receiving priority, were likely unconstitutional.

They also discussed how tariffs impact the cannabis industry and how potential federal tax relief from an end to IRS code 280E could offset increased costs from tariffs. Additionally, they considered the less discussed benefit of declassification: the increased ability for research and development dollars to flow into the cannabis market.

Blunt Business welcomes Darren Gleeman, author of "The Cannabis ESOP Architect," to discuss how Employee Stock Ownership Plans (ESOPs) offer a revolutionary, IRS-approved, zero-tax exit strategy for cannabis businesses, making the 280E tax irrelevant.

Darren explained that ESOPs are the only significant M&A activity in the cannabis sector, fostering employee engagement and retention by turning them into owners with bulk payouts upon leaving, while increased cash flow from tax savings fuels company growth. He also stated that federal rescheduling would enhance ESOP benefits, and discussed the book's role in educating the industry and his interest in advertising strategies for client acquisition.

Blunt Business welcomes Melissa Hanson, Flowhub's new VP of Operations, to discuss their new e-commerce platform, which aims to power online cannabis retail growth.

Melissa, leveraging her 20 years of retail experience, explained that the platform was designed by former Wayfair experts to streamline dispensary operations by removing the need for multiple vendors and ensuring live inventory and deal syncing.

Flowhub emphasizes a client-centric approach, viewing clients as partners and actively incorporating their feedback for future updates.

Corinne Butler discusses Azuca's "2025 Edibles Premiumization Report," which highlights that premium cannabis is defined by efficacy and that consumers are willing to pay more for fast-acting edibles due to their predictability and consistent experience.

Corinne detailed how Azuca's encapsulation method ensures fast-acting effects (5-15 minutes) and preserves Delta-9 THC, addressing common inconsistencies in traditional edibles.

We also covered the clean label movement in cannabis, women driving the shift to cannabis beverages, and concerns about the 2026 Farm Bill potentially impacting hemp-derived CBD products.

Joe Ziolkowski, CEO of Relm Insurance delves into the evolving landscape of insurance for emerging and high-risk industries. They specifically addressed the significant insurance gaps for THC beverages and the prevalent underinsurance within the broader cannabis sector. Ziolkowski highlighted Relm Insurance's strategic diversification within the cannabis market, expanding its operations and achieving 50-state Managing General Agent (MGA) status to enhance accessibility and direct engagement with clients.

The discussion also covered critical issues like climate change risks impacting cannabis cultivation, underscoring the necessity of robust data collection and compliance for accurate risk modeling and premium setting. Ziolkowski emphasized that meeting higher compliance standards, such as GMP, can lead to more favorable insurance terms. The conversation further explored the regulatory complexities of insuring new products like THC beverages, where traditional product liability may not suffice, and the nascent psychedelics industry, where Relm aims to facilitate business models by finding viable coverage solutions.

We learn about Relm Insurance's deliberate expansion into the AI insurance sector, a move Ziolkowski explained as a natural progression due to the similarities in underwriting new and emerging risks, including data governance challenges and underdeveloped legislative frameworks. He also noted AI's potential to improve efficiency in cannabis, such as in precision farming.

Ziolkowski concluded by stressing Relm's core vision of "making innovation resilient" and their long-term commitment to supporting forward-looking industries like cannabis, psychedelics, and AI, distinguishing them in the insurance market through their dedication to these sectors.

Rama Mayo, the Founder of Hall of Flowers, discussed the upcoming Hall of Flowers events coming to Santa Rosa, California (site of their very first event) as well as hosting their first New York show and its significance for the cannabis industry. Hall of Flowers, a B2B cannabis trade show, has garnered significant praise, particularly for its California events.

Rama shares his and his team's connection to New York City and provided updates on event preparations, including the number of brands and retailers, and highlighted the strategic location and offerings of the New York event.

We also covered Hall of Flowers' commitment to social equity, their strict vetting process for exhibitors and attendees, and the challenges of regulatory compliance.

Cannabis Tax Attorney James B Mann highlights the ongoing frustration within the cannabis industry due to persistent delays in legalization and reform, particularly concerning the SAFER Banking Act and Section 280E.

James addresses the perceived ineffectiveness of current lobbying efforts and explores various legal challenges to Section 280E, noting instances where companies have successfully disputed its application and received tax refunds.

We underscore the critical need for more impactful strategies, including broader public outreach and the implementation of a simpler tax structure, to drive meaningful change in the cannabis sector.

Blunt Business welcomes Joshua Horn, co-chair of Fox Rothschild's LLP's cannabis law practice. We addressed several key issues impacting the cannabis industry, including the detrimental impact of California's upcoming cannabis tax increase, the challenges posed by the persistent illicit market, and the lack of state enforcement against it.

We also addressed the stalled federal rescheduling of cannabis, attributing it to political factors and potential resistance within the DEA, while briefly touching on Pennsylvania's legalization efforts and frustrations with the lack of clear federal regulation.

We also focused on the lack of progress in rescheduling cannabis at the federal level, despite the Biden administration's recommendation. Political factors and potential internal resistance within the DEA were cited as reasons for the delay. We also noted that the federal government's current tax revenue from the existing 280E structure might act as a disincentive for reform.